"I get in trouble when I say things like this" - Michael Lewis on Sam Bankman-Fried

Summary

Cautionary Tales with Tim Harford
Episode: "I get in trouble when I say things like this" - Michael Lewis on Sam Bankman-Fried
Release Date: July 11, 2025

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1. Introduction and Guest Introduction

In this episode of Cautionary Tales, host Tim Harford welcomes Michael Lewis, renowned author of The Big Short, Moneyball, and his latest work, Going Infinite: The Rise and Fall of a New Tycoon. The conversation sets the stage for an in-depth exploration of Sam Bankman-Fried, the enigmatic founder of the cryptocurrency exchange FTX, whose abrupt downfall has captivated the financial world.

Notable Quote:

Tim Harford (00:26): "If you've not listened to that episode yet, please do before listening to this special cautionary conversation with Michael Lewis, the man who had a ringside seat for the spectacular fall of the cryptocurrency wunderkind."

2. Effective Altruism and Sam Bankman-Fried

Michael Lewis delves into the profound influence of the effective altruism movement on Sam Bankman-Fried. He explains how Bankman-Fried, despite his initial lack of interest in money, was drawn into high-frequency trading and cryptocurrency by the principles of effective altruism, which advocates for using data and reason to maximize positive impact.

Notable Quotes:

Michael Lewis (05:55): "His parents were both law professors at Stanford. They're like non-materialist people. They don't care about stuff, they don't care about money."

Tim Harford (06:53): "It's amazing how even when you're looking at people we would all think of as experts, doctors, that algorithms outperform the experts when rendering diagnoses."

3. The Downfall of Sam Bankman-Fried

The discussion shifts to the dramatic collapse of FTX, highlighting the complex interplay of ethical considerations and financial misconduct. Michael emphasizes that Bankman-Fried's actions were not rooted in malice or inherent dishonesty but were a result of overwhelmed responsibilities and systemic issues within his organization.

Notable Quotes:

Michael Lewis (13:38): "If I'm giving myself a 5% chance of saving the world, then I'm 5% of Superman."

Tim Harford (14:02): "Well, as I understand it, Sam Bankman Fried would have said, if I'm giving myself a 5% chance of saving the world, then I'm 5% of Superman."

4. Listener Questions on Altruism

After a brief interlude, Tim introduces questions from listeners, delving deeper into the motivations and ethical frameworks of effective altruists. Topics range from prioritizing AI risk over immediate humanitarian issues to the societal need for altruism itself.

Notable Questions & Responses:

• AI Risk vs. Immediate Harms:

  Listener Nochum (20:29): Questions why effective altruists prioritize AI risk over more immediate issues like poverty and health.

  Michael Lewis (21:14): "It was pre-Covid, when he was throwing money into pandemic prevention... he couldn't figure out what to do about it."

• Altruism in Society:

  Listener Victor (25:52): Asks why society relies on altruism instead of having a more benevolent government structure.

  Michael Lewis (26:20): "These jobs self-select for people who really like doing big important things but don't care credit or money."

5. Discussion of Michael Lewis's New Book "Who Is Government?"

Transitioning to his latest work, Michael Lewis discusses Who Is Government?, a collaborative effort with six writers to profile the underappreciated heroes within the U.S. government. The book highlights the dedication and expertise of bureaucrats who operate behind the scenes to keep society functioning, often unnoticed by the public.

Notable Quotes:

Michael Lewis (30:48): "Whatever the stereotype of the bureaucrat is in the American mind, they violated it."

Tim Harford (35:09): "And he, he busted paedophile rings. There's one point where somebody from Hamas tweets and says, oh, you can donate to the revolutionary cause, send your bitcoin to this address. And he redirects it, basically hacks their bank account."

6. Conclusion

The episode concludes with reflections on the moral complexities of effective altruism and the indispensable yet overlooked role of government officials. Tim and Michael underscore the importance of recognizing and supporting those who work tirelessly to address both immediate and existential threats to humanity.

Notable Quote:

Michael Lewis (44:35): "There are problems I can solve and it will help others. And never mind how much I'm paid or whether I'm acknowledged for it."

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Key Takeaways:

• Effective Altruism's Double-Edged Sword: While the movement advocates for maximizing positive impact, its rigid focus on data and long-term outcomes can lead to ethical quandaries and unintended consequences, as exemplified by Sam Bankman-Fried's actions.

• The Human Side of Bureaucracy: Who Is Government? sheds light on the passionate and dedicated individuals within government institutions who play crucial roles in maintaining societal functions, often without public recognition.

• Ethical Decision-Making in High-Stakes Environments: The episode highlights the delicate balance between altruistic intentions and ethical behavior, emphasizing the need for accountability and transparency in endeavors that wield significant influence.

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For more insights and full episodes, visit Tim Harford's website or subscribe to Cautionary Tales on your preferred podcast platform.

Transcript

[Tim Harford]

This is an iHeart podcast.

[Michael Lewis]

Run a business and not thinking about podcasting? Think again. More Americans listen to podcasts than ad supported streaming music from Spotify and Pandora. And as the number one podcaster, iHeart's twice as large as the next two combined. Learn how podcasting can help your business. Call 844-844-IHeart.

[Tim Harford]

Pushkin. On 10th November 2022, Sam Bankman Fried tweeted that he had f'd up. As we explored in our last episode, that was something of an understatement. Ftx, the digital currency exchange platform where individuals could trade cryptocurrencies and store their funds for safekeeping, imploded when it emerged that Sam Bankman Fried had been diverting funds into his crypto hedge fund Alameda Research fraud. Yes, but as an effective altruist, he was doing it for a good cause, wasn't he? In his own misguided way, he thought he was just following the teachings of Will MacAskill, the founder of the effective altruism movement. And that can't be bad, can it? If you've not listened to that episode yet, please do before listening to this special cautionary conversation with Michael Lew, the man who had a ringside seat for the spectacular fall of the cryptocurrency wunderkind. Michael. Welcome to Cautionary Tales.

[Michael Lewis]

Tim, good to see you again.

[Tim Harford]

It's great to see you. I think the last time we saw each other, I was trying to teach you how to play an obscure German board game.

[Michael Lewis]

No, that's exactly right. I can't even remember what book led you to get interested. Maybe the Big Short.

[Tim Harford]

I think it was the Big Short, but the FT were like, oh, no, you can't just talk to Michael Lewis about his book. You have to talk to Michael Lewis about his book while you teach him a weird German board game.

[Michael Lewis]

I thought it was actually ingenious because I try to do this with subjects, and especially if you only have a short time with them, you're so much better off doing something with someone than just talking to them if you're trying to kind of get some insight into how they tick. The best job interview I ever had it was to lead teenage girls through Europe. When I was 22 years old, I went to the tour agency, and the guy who ran the tour agency said, God, I forgot you had an interview this day. We're supposed to move the furniture from this office down the hall to the other office. Could you just help me do that? And then if we have time left over, we'll talk. And I spent an hour moving furniture with this guy. And I left. He said, I'll call you about the interview later. And I left bewildered. And like a week later he said, you have the job. And two months later, I'm in a hotel room with my fellow leader in, like, Bruges. And I said, you know, this was odd. I was never interviewed. And I explained what happened. He said, I moved that furniture too.

[Tim Harford]

Back.

[Michael Lewis]

Back the other way. And it was a really smart way to kind of figure out whether someone was collaborative, whether they could pick up stuff quickly, how they interacted with people. So I took it as a sign. You were a journalist when you did this?

[Tim Harford]

Yeah, well, or I have a clever editor, but yeah. Michael, I'm already feeling bad that I haven't brought a board game this time, but I'm sure we'll be fine. I'm sure we'll be fine. We are going to talk about the time you spent with Sam Bankman Fried. What you made of him, what you made of the influence that effective altruism had on him. And we're also going to be answering listener questions. And we'll be talking about your new book, who Is Government? Before all of that, here is the cautionary tales theme. The most remarkable thing about Going Infinite is that when you started working on it, you had no idea that you were going to be covering the fraud of the century. You were just intrigued by Sam Bankman Fried. And this book turned into a very different book during the course of writing it. And it feels like this is not the first time you've been in the right place at the right time. I'm curious, how. How is it that you find your subjects?

[Michael Lewis]

You know, I stumbled into this. I had no idea that there was, like, fraud going on. So I was asked to evaluate him by an investor who was doing a deal with him. And it was a friend. And I said, sure. I had no idea who he was. He turns up on my doorstep in Berkeley and we spent a couple of hours together. And in a couple hours I realized I had this character who was, one, he thought about the world in a very unusual way, in a very persuasive way. But two, he would possibly give me access to several places I wanted access. One was Jane street in the world of high frequency trading, because he'd spent three years at Jane street and he'd hired a bunch of people out of there and they're notoriously opaque and won't talk to journalists. So I thought, ah, maybe I'll get to Jane street through him. Yeah, Money in politics because he was handing out money left, right and center to American politicians and the crypto world, which he was very skeptical of. And so he wasn't a religionist, so he wasn't defensive about it. So I remember saying to him, I don't know where this is going to end up. Could I just hang out and watch? You know, he was the world's richest person under the age of 30, according to Forbes magazine. It wasn't the big brainwave on my part. It was kind of surprising he let me do it, especially in view of what was going to happen. So I just follow my nose and my nose isn't like, oh, what's going to be the next big story? My nose is more what's not dull. And sometimes that works out, you know, sometimes that ends up being. Which you should be paying attention to.

[Tim Harford]

Yeah. So as you hung out with Sam Bankman Fried more, you must have become aware of this whole effective altruism thing, seemed to play a huge role in.

[Michael Lewis]

His life and how he thought, you're exactly right. It kind of blew my mind. I'd never heard of this. The idea that he had gone to Wall street with absolutely no interest in money. His parents were both law professors at Stanford. They're like non materialist people. They don't care about stuff, they don't care about money. In another generation, he'd have been like a high school physics teacher or maybe a college professor. He was not the social type who goes to Wall Street. And he'd forced himself into it because he had discovered, before he discovered Wall street, this movement called effective altruism that just resonated with him and seduced into.

[Tim Harford]

It by the philosophers.

[Michael Lewis]

And they proselytize and they actually will. McGaskill told me. He said it turned out that the ideal market for these ideas were nerdy math science people at American universities, people who were attracted to this kind of quantitative solution of how to lead your life, maximize the number of lives you save.

[Tim Harford]

I mean, just as an aside, I've been writing a column about the Trump administration's decision to cut foreign aid. And it's slightly controversial exactly how much foreign aid they've cut and exactly what they're cutting and the conflicting statements. But plausibly sensible. Independent analysts reckon that decision is going to kill a million people a year. And it's mostly people with hiv, although there are a few other things. There are some vaccinations, there's tuberculosis, but you have hiv, you have very effective medication as long as you take the medication, you're fine. The moment you stop taking the medication, the virus starts to come back and pretty soon you're going to die. And I'm writing about this and somehow I can't quite get as outraged about those million people as if they were being rounded up and executed for being illegal immigrants or if they'd started some war that was likely to kill a million people. It just feels different somehow. Dead is dead. Right.

[Michael Lewis]

Part of the reason it feels different is it's a number. Right. Especially the bigger the number. It just becomes a number. You would feel much more outraged if you saw just a single child die.

[Tim Harford]

Yeah.

[Michael Lewis]

We don't respond to. To data. We respond to anecdote.

[Tim Harford]

Yeah. Unless you're Sam Bankman Fried.

[Michael Lewis]

Unless you're Sam Bankman Fried.

[Tim Harford]

Respond to the data.

[Michael Lewis]

You know, there's a jumble of my previous books that are sort of popping into my head when he starts talking this way. One is Moneyball. Oakland A succeeded because they ignored the anecdote and looked to the data. And two was the Undoing project. Kahneman and Tversky were all about the way our minds mislead us when we trust our intuitive sense of things rather than the data. It was interesting that this was wholly persuasive to this kind of person and not just Sam Bankman Friedman. But there was a whole crowd. I mean, it was cult like. As McCaskill said, they tend to be kind of on the spectrum. They tended to be male. They tend to be math or physics. They tend to be socially awkward. There were people who. For whom emotion was a weak guide to action. Whatever you or I feel that leads us to do things, they didn't feel so much. But they could talk themselves into using logic and numbers as a guide to action in the way that emotion is a guide to action for us.

[Tim Harford]

Are the numbers a better guide to action than emotions?

[Michael Lewis]

Depends on what you're doing.

[Tim Harford]

Yeah.

[Michael Lewis]

I mean, let's go back to the Moneyball case. Most of the time in baseball, the statistical information that you are way better off being guided by than your nose every now and then. That's not true. But most of the time in life you don't really have the numbers. Like, how are you going to decide who you're going to marry or where you're going to live, or even where you're going to go to college or even where you're going to have dinner tonight. How do you reduce that to a statistical problem? We are kind of forced by the dearth of statistical information to Constantly rely on our intuitive judgment. And so it leaves us kind of sleepy to the possibility that there is some statistical information that could inform our judgment. Often when there is, though, yes, I think it is better. Kahneman and Tversky showed just. It's amazing how even when you're looking at people we would all think of as experts, doctors, that algorithms outperform the experts when rendering diagnoses, that kind of thing.

[Tim Harford]

One of the things that struck me exploring the story for cautionary tales was when effective altruism took this, what seems to be a little bit of a weird turn. So on the one hand, you've got the people who are like, okay, I've got $1,000 and I want to save the maximum number of lives. They crunch the numbers and they go, yeah, it's probably bed nets impregnated with anti mosquito pesticides. And if you give it, you give out a lot of bed nets. You could save a life for whatever, $1,000, $3,000. So it's cheap. It's cheap. And that's better than maybe spending the money on vaccinations, Even though vaccinations are good. And vaccinations are better than spending the money on work to improve governance. And improved governance is better than giving it to a donkey sanctuary, because all of the donkeys are living in luxury. They're all fine. So that all makes sense up to that point. You go, the effective altruists are on it.

[Michael Lewis]

I'm with them.

[Tim Harford]

This is great.

[Michael Lewis]

I'm with them too. So I feel the same way. I'm with them too. They just make me, at that point, they just make me feel guilty for how I'm living my life.

[Tim Harford]

And then they start having these conversations like, well, you know, there could be a lot of people in the world in the future. The future could go on for a very long time. We could be talking about trillions of people. We could be talking about intergalactic civilizations or human civilization lasting a million years. But maybe AI ruins all that. So maybe if we have a workshop about AI safety, maybe there's only a one in a billion chance that it will do anything. But if it does something, it could save a trillion lives. So a one in a billion chance of saving a trillion lives, that's 1,000 lives, right? That's really good. And so it's totally worth spending $50,000 on our AI workshop. At which point you start like, where did it go wrong? Or are they right? Am I wrong?

[Michael Lewis]

So I had exactly the same feeling. It jumped the Shark around 2012. And Toby Ord writes this book about existential risk where he's putting numbers on the likelihood of various events wiping out humanity. And it's AI and pandemics and meteor strikes and nuclear war, so on and so forth. Very hard to put numbers on that. But of course, you can't do the calculations without the numbers. So they just accept roughly good numbers. And it's just not at all clear to me the numbers are okay at all. The math becomes much shakier. That's one thing that happens. The numbers become much bigger. You're not just talking about saving lives in Africa right now. You're talking about all future humanity, infinite people. And so the sums of money required to address these problems also becomes much, much bigger. $1,000 will be useful in Africa right now. $1,000 right now to prevent AI from eating US all. One day is nothing. Sam Bankman Fried sits down and does a back of the envelope calculation. He thinks he needs at least $100 billion to make a dent in this or that problem. So all of a sudden it gets very grandiose and it's completely. Even if they were never entirely interested in the emotional resonance of saving the life of a small child in Africa today, there was at least some emotional content there. And all of a sudden it vanishes. It's purely an abstract math problem. And then of course, as you just said, what can't you justify when the numbers are that big? The number of people you're gonna say that big. What can't you justify doing to attack the problem? It seems perfectly rational to do whatever you need to do to make $100 billion to eliminate or at least defray this existential risk.

[Tim Harford]

Yeah, this is the end of the world we're talking about. The end of human civilization. You should be able to cut some corners at that point.

[Michael Lewis]

So what you're doing also, if you think about it, is you're puffing yourself up. You're a superhero now. You're now going to save humanity. You may only be increasing the odds that humanity is saved by a few percentile, but nevertheless, you're in the realm of saving humanity.

[Tim Harford]

Yeah.

[Michael Lewis]

So it creates a grandiosity to the whole thing.

[Tim Harford]

Well, as I understand it, Sam Bankman Feedback would have said, if I'm giving myself a 5% chance of saving the world, then I'm 5% of Superman. Right.

[Michael Lewis]

There we go. So this is how he was thinking when I first met him. And I thought it was bonkers, but I thought it was interesting. It's not Wrong. It's not obviously wrong. It's probably obviously right that there are these extinction level events that could happen.

[Tim Harford]

Yeah.

[Michael Lewis]

The question is like, is it bonkers to think you could do much about them? Yeah, there's something that goes on when you're doing things that have such a remote probability of having any effect. It's very different from buying a bed net and saving a kid. The degree of uncertainty gets so high. And so when you look at how what happened to the EA movement around Sam, they had their arguments about this, but the people who move with Sam all bought into, you know, we're saving humanity. And they left behind a collection of original EA's who sort of disapproved and who continued to, you know, buy bed nets for kids in Africa.

[Tim Harford]

Do you think it is fair to blame effective altruism for what Sam Bankman Fried did and you know, the fraud and him going to prison and all of that? To what extent can you track it all back to effective altruism?

[Michael Lewis]

Can we assign fractional blame?

[Tim Harford]

I think that's totally in the spirit of the hardest.

[Michael Lewis]

Okay, let's, in the spirit of Sam Bankman Fried, let's do little shares of blame. So I would say the little sliver of blame that effective altruism gets is in how it was sold to the Sam Bankman Fried's of the world. You are this nerd with a high sense of your own self importance, but it hasn't been appreciated by the world who is coming of age in a world where very weirdly you can get rich very quickly because your particular gifts are all of a sudden in demand at Jane street and Hudson River Trading and Citadel and all these quantitative trading shops and also tech firms. So all of a sudden you're the most monetizable 22 year old on the planet, maybe a professional athlete. And if you unleash your money making skills for the good of this movement, you're a superhero. They're given a kind of license to behave in unorthodox ways.

[Tim Harford]

Maybe it never occurred to Will that somebody would, oh, I guess I could commit a massive fraud and as long as I save the planet, that's fine. It possibly never occurred to the philosophers that anybody would think to do that it's possible.

[Michael Lewis]

That's a funny thing you say that. I think that's possible. So I think if Sam Bankman Fried is a creature of anything, effective altruism is really important. But so is Jane street. The high frequency trading world they live to game systems. You're in there to Figure out how to game markets. And people who are really good at playing the game are the people who win. And Sam was really good at playing the game. Obviously you're not supposed to break the law, but it puts you in a certain frame of mind when all you're doing is gaming markets day after day after day. You're looking for little edges. And if I were to sign another sliver of blame, kind of the grown up world of finance, it was obvious to anybody who walked into the FTX that there was a basic conflict of interest. He had this private trading firm that he'd started first out of which grew this public crypto exchange. And that his private trading firm traded on the crypto exchange and was in a little hut next door to it in the Bahamas. So some blame there. But of course also blame to Sam. What is it in Sam that leads him to do this? You know, he danced his way out of lots of problems before. I think he thought he was smart. So smart that he could kind of figure this out. And in fairness to him, I think he was overwhelmed. If you'd seen their business, your first reaction would be, this is pure chaos. There's no organization chart. No one knows who the job actually is. The corporate psychiatrist is the person who knows the most about the business because he's the only one everybody talks to. You know, it was like one thing like that after another. What it didn't feel like and still doesn't feel like to me, and I get in trouble when I say things like this is malice. What he wasn't and isn't is like this natural crook. He doesn't have cruelty in him. Oddly, he doesn't have a lot of dishonesty in him. He has some. But up to the moment it's discovered that he has the money in the wrong place, that he's used his customer's money, do all kinds of things he didn't have permission to do. There's not really a trace in Sam Bankman's Freed's life of criminal behavior or corrupt behavior. Didn't cheat on tests, didn't cheat at golf, never played golf. You know, you go back to his childhood, there's no sign of anything like this. And so it's not like this is who he is. It makes it even a weirder event.

[Tim Harford]

Do you think he was a kind person or is a kind person?

[Michael Lewis]

Yes, I mean, you know, qualify it, but he behaved very well to the little people around him who helped him. He would get worked up and scream every now and then, but I think because he was on the receiving end of it when he was a kid a lot. I think he was highly sensitive to suffering. I think suffering bothered him. And he was also highly averse to conflict. Like, he was really uncomfortable getting into conflict. He'd go and hide rather than fight. Every now and then he'd get upset and everybody around him would get scared. But it was very private. It was like watching a little volcano go off. So, yeah, I think he is basically the kind person. And he. To this day, I'm still in touch with him. He writes a prison diary and he sends it to me. He's pretty careful about his interactions with other people. He's in no conflict. People kind of like him because he kind of watches out for them a bit. I mean, what he did was really wrong. But when, you know, his personality, it's even stranger. He did it.

[Tim Harford]

Interesting. Very interesting. Well, Michael, stay with us. I'm gonna give you questions from our loyal listeners, particularly on the subject of kindness and altruism. And we shall hear them after the break. We're back. I'm talking to Michael Lewis, the author of Going Infinite the Rise and Fall of a New Tycoon, a book which tells the story of Sam Bankman Fried, the world's most infamous effective altruists. And, Michael, we've asked our listeners to send in their questions about altruism. Are you game for answering a few?

[Michael Lewis]

Sure.

[Tim Harford]

So here's one from, I think from Nochum. Apologies if I've mispronounced your name. They write as an admirer of Mr. Lewis's books since Liars Poker. When I heard he was answering questions about altruism, I had to ask this. According to the latest data, I could find the most important cause for effective altruists after poverty and health is AI risk. There are real challenges to the adoption of AI but to put it so high on the list of causes to donate to seems misguided at best. Can you explain how AI overtook such obvious harms as global warming or the public benefits of the spread of free markets, free speech or democracy as the greatest good an effective altruist can do all the best? No. Come.

[Michael Lewis]

This is one of those really great questions that I probably can't answer satisfactorily. But it is a great question. I think in the minds of Sam Bankman Frieden and the people around him, they thought of these existential risks in two ways. How salient are they? How likely are they to cause problems to actually happen? And how tractable are they? What can we actually do about this. And in Sam Bankman Fried's mind, when he did that calculation, it wasn't AI that bubbled to the surface. It was pandemics. He threw much more money into pandemic prevention than AI. Even though he thought AI was the greater risk, he couldn't figure out what to do about it.

[Tim Harford]

Would this have been pre Covid, when he was throwing money into pandemic prevention?

[Michael Lewis]

It was pre Covid, when he was thinking about it, when he started to have real money, we were in the thick of COVID It was like, if a really even more deadly one comes along, how can we be better at defending ourselves against it or detecting it and preventing it in the first place kind of thing. The one move he made in AI Prevention, other than funding people with small sums of money who had interesting ideas, but he bought a big chunk of anthropic, which was the kind of salon de refuse for OpenAI. People who thought that OpenAI wasn't paying enough attention to the risks. And that, funny enough, ended up being, you know, worth many, many billions of dollars to his creditors. So why were they so alive to AI as an existential risk? Because your questioner's right. It's not obvious. It's not obvious to me.

[Tim Harford]

Let me flip it around and say, why are they not worried about climate change as an existential risk, for example?

[Michael Lewis]

The answer to that is they think that climate change, no matter how bad it gets, they'll still be human beings alive.

[Tim Harford]

Yeah. And they're probably right. I mean, it's not going to turn the Earth into Venus. Right. It could make things really uncomfortable. We could really regret we didn't do more earlier, but the idea that it could, that it ends the human race seems unlikely. So they're looking for things that will actually end it. Absolutely. End human civilization. And there, I guess, you're looking at nuclear weapons and AI are more plausible.

[Michael Lewis]

Maybe that's right. AI had the capacity to do the job completely, in a way even pandemic wouldn't. I don't even think nuclear weapons are that plausible. So they could play out a scenario where there were no longer people because of AI.

[Tim Harford]

It throws a light on this, the difference between a long term effective altruist and the rest of us. The rest of us would go, hey, if there was a nuclear war and 99% of the human race was killed and the rest of us were reduced to the Stone Age and had to build from scratch, that sounds incredibly bad. Whereas for an effective altruist, they're like well, if you think really long term on a 2 million year time horizon.

[Michael Lewis]

That's right.

[Tim Harford]

It's not the worst thing.

[Michael Lewis]

It just shows you where you can go when you're untethered from normal human feeling and convention. That's the real thing about the effective altruist is that at bottom, it's a status movement. It's a group of people who feel underappreciated, slightly ostracized, who know in some ways they're smarter than their peers. Essentially, the starting point is everybody else is stupid. They don't know, and it takes them to weird places.

[Tim Harford]

Let me throw in a thought from listener Matt. I'm going to paraphrase, but it's relevant, I think, to what you're just saying, Michael. So Matt conjures up the idea that people who eat meat are, in a way very good for pigs and chickens and cows, in the same way that.

[Michael Lewis]

People who want ducks are very good for ducks. Because you created the need for these animals to exist.

[Tim Harford]

Yeah. You know, if a Martian came down and looked and said, you know, what are the dominant species on Earth? Then there's a good case that some of the dominant species are the species that humans eat. And the reason they're dominant, there are so many of them, have taken over all these different ecosystems is because that's what the humans want anyway. He draws a parallel between that perspective and effective altruism. Is it too harsh to think of effective altruists as benign butchers ready to sacrifice real people today for the sake of a notional gain to humankind over eons? So there's no end to the suffering you can tolerate today as long as you're maximizing the quantity of humanity in.

[Michael Lewis]

The long run, I'd be willing to play this game with him. Except the effective altruists themselves did not acknowledge they were willing to inflict suffering on people today. They just thought they were shifting their attention from people today to people in the future. They were shifting their neglect, if you want to think about it the other way. So they weren't actively thinking of themselves as inflicting suffering on present humans.

[Tim Harford]

Although Sam did.

[Michael Lewis]

Although Sam did. Although the logic of their argument would lead them to do it if necessary. Yes.

[Tim Harford]

Interesting question from Victor. Victor asks, why is no one talking about why we need altruism in the first place? What are we doing wrong as societies that some people are left behind and there's a need for altruism? I suppose this gets to the idea of if you had a benign government or if you had the right rules or the invisible hand of Adam Smith. But if we somehow organize society better, no one would have to be kind or altruistic because all these problems would be solved anyway.

[Michael Lewis]

This is a fair question too. Without human sympathy, let's not call it altruism. Let's just call it kind of a basic sympathy for our fellow creatures. Without that, why would you bother to organize society in a kinder way like that is what's at the bottom of attempts to organize society so that you don't need it. It's a funny situation in a way, because when I think of altruism, the kind of selflessness every time you scratch the surface, you find some human motive for what they're doing. Selfish might be too strong, but it's not exactly selfless. So when you ask this question, my mind goes in a completely different direction. And my mind goes in the direction of do we actually even have altruism? Is there such a thing? I think it's more complicated than that. The minute you were sitting in a room with Sam Bankman Fried and his fellow effective altruists at ftx, you realized they were engaged in a kind of competition with other effective altruists. Who's gonna be the biggest deal in the effective altruist community? It's like, who's gonna save the most future lives? They never put it quite so crudely, but it was in the air.

[Tim Harford]

Maybe that's good. You've got these kind of killer competitive instincts. And it could be people killing each other with machetes, or it could be Wall street traders trying to make the most money.

[Michael Lewis]

The beauty of early Sam Bankman Fried and his crowd was so we have this machine called Wall Street. It has gotten better and better at extracting rents. The people who are the peak predators on Wall street now are the high frequency traders, the Citadels, the Jane Streets, the Jump trading, the Hudson River Trading Virtu. All these places generating more money for individuals than have ever been generated on Wall street before. And all of a sudden, the kind of person who's good at that has this religion about giving the money away. I thought for a brief moment there was this kind of Robin Hood thing that might go on. And in fact, Jane street, which is the leader of the pack, Jane street, started to worry that too many of the people that they were recruiting were effective altruists. And the problem with the effective altruists is they couldn't control them in the way you control a normal person who just wants a fourth house and a third yacht. They didn't have the same materialist needs. They were doing it for this kind of quasi religious reason and it made them much harder to manage. But I thought, what a great problem. Wouldn't it be cool if instead of like reforming Wall street cuz we'll never do it, that it sort of weirdly reformed itself? Because the kind of person who got into the position of making the most money felt like it was his religion to give it away. That would have been cool.

[Tim Harford]

Yeah, it would have been.

[Michael Lewis]

Would have been.

[Tim Harford]

So a quick question from our listener Richard, which I think is tied to that point. It's an etiquette question really. He says, if you give money to charity, should you tell everybody about it or should you just do it? Should you just do it quietly? On the one hand, you should do it quietly because it's undignified and it's not about you, it's about the charity. But on the other hand, if you tell your friends you're giving money to charity, then maybe that will encourage them to give as well.

[Michael Lewis]

Oh, that's an interesting way to put it. I don't think people who put their names on buildings are doing it because they want to encourage other people to put their names on buildings. It's self Advertisement I was raised to be very quiet about this sort of thing, that when you give money, you always list it as anonymous. I've had organizations ask we put our name on it, and I said, and when they want that, I let them do it. My answer to the etiquette question is let the recipient decide whether they want your name on it or not, what's better for the recipient, and do whatever is better for them.

[Tim Harford]

Thank you, Michael. Brilliant answers. Hold on with us and let's talk about your new book, who Is Government? After the break, we're back. I'm here with my fellow Pushkin podcaster, the brilliant writer Michael Lewis. Michael, you very kindly agreed to come on the podcast and talk about Sam Bankman Fried and talk about going infinite. And then I got a message saying, oh, by the way, Michael has a new book out. You should probably ask him some questions about that. I have to admit, my heart sank a little bit. I thought, I don't really have time to read another book in preparation for this podcast. And of course, the moment I opened the first page, I was immediately drawn in and I loved the book. So congratulations. But tell us about who is Government?

[Michael Lewis]

So I wrote a book about our set in the first Trump administration called the Fifth Risk, where I wandered around the administration, the executive branch and got essentially an education from the various departments that Trump himself refused to get. So how the Agriculture Department worked, how the Energy Department worked, what went on inside these places, and the longer I spent there, the more taken I was with the actual characters in government. Whatever the stereotype of the bureaucrat is in the American mind, they violated it. There were these breathtakingly devoted public servants who were experts in all kinds of arcane and in some cases, spine tingly, frightening fields, who were doing the work that kept the society together. And I thought, you know, there really was a project coming back and just doing profiles of these people. And it wasn't so much because I saw Doge coming. I'm surprised Doge came. It was more that I thought just generally the conversation around American government had gotten so dumb because people didn't really appreciate what the government did and who the people were who did it. So I recruited six writers. Dave Eggers, John Lanchester, Geraldine Brooks Casey, Sepp Kamau Bell, and Sarah Vall. None of them really conventional journalists. Kamau Bell's a standup comedian. Dave and Geraldine, mostly novelists, same as John, and just dropped them into the government, said, look, find a story. And I did two of them. And the idea was just like, inoculate the American public against these really stupid critiques of their government. I mean, these things ran one by one each week in the eight weeks running up to the election. And then we put them together because they got so much attention. The thing that really got me was actually the quality of the material. Like, that first story is about a guy named Chris Mark who figured out how to prevent the roofs of coal mines falling in on the heads of coal miners. And you think, well, that's an arcane problem. And how big a deal could that be? 50,000American coal miners killed by roof falls in the last century, and who knows how many more around the world. And there was just an imperfect science in how to keep the roof of a coal mine up. And how this person comes to his expertise, why he does it, how he does it, is literate. It was just like this stuff of novels. You find that over and over again in the government.

[Tim Harford]

The story about Christopher Mark, we don't want too many spoilers, but his father is kind of, among other things, an expert in why Gothic cathedrals don't fall down.

[Michael Lewis]

And he rebels against the father.

[Tim Harford]

Yeah, they don't get on at all.

[Michael Lewis]

They don't get on. He leaves home and refuses to get a college education. He goes and joins the working class and then essentially reprises his father's career underground. And when I tell him that, he gets angry at me. No, it has nothing to do with my father. Yes, my father figured out how the roofs of Gothic cathedrals don't fall down, but that has nothing to do with how the roofs of coal mines don't fall down.

[Tim Harford]

Yeah. And of course, it's the same problem.

[Michael Lewis]

It's the same.

[Tim Harford]

Basically, there's some little differences, but, yes.

[Michael Lewis]

From any kind of perspective outside of his own, it's the same problem. And so that there were these psychological portraits to draw that were just fun. I don't know how you think about what you do. I think about what I do is like gold mining. I'm a prospector. I wander around, you know, the mountains of California, kicking up dirt under my feet, looking for a place where I can sink my pick and maybe find some gold. And it's kind of random when I find it. There's not a great science to the finding of the gold. You get good at sort of analyzing the landscape. You get a sense of where this might be and where it might not be. But it's still a lot of luck involved. I felt that with the fifth risk, I found this unbelievably rich vein of ore. I could only scoop out a fraction of it because there was so much of it. And I was working with my hands, and I had a bucket on my back, and there was all this stuff left behind, and I thought it would all be gone by the time I came back to it. And in fact, it's like, no one bothered to go find the mine. No one's interested.

[Tim Harford]

There's this line by Geraldine Brooks, one of the writers in who is Government? She's profiling a guy who is a jiu jitsu instructor, tennis coach, fights terrorists and pedophiles, but is a qualified accountant and works for the Inland Revenue Service. And she says, you know, if this was a novel, this would be malpractice.

[Michael Lewis]

Right.

[Tim Harford]

You can't just make this sort of stuff up. But because it happens to be true and this guy is a real person, I'm actually allowed to have him as a character in this story.

[Michael Lewis]

And it tells you something. This person who is like, the profit center of the United States government because he's busting up cybercrime rings and raking in their bitcoin and sticking it in the treasury. He's generated billions with his team, billions of dollars of free money for the government, and the Trump administration has disabled him. They fired half his unit, and he can't do what he did before then our population isn't just completely outraged by this is incredible to me. But they wouldn't know to be outraged unless you knew the story. And, and you only know the story if you read Geraldine's piece because it's not in the news. Otherwise it's astonishing.

[Tim Harford]

And he, he busted paedophile rings. There's one point where somebody from Hamas tweets and says, oh, you can donate to the revolutionary cause, send your bitcoin to this address. And he redirects it, basically hacks their bank account. I have to say the details of exactly how this happened are lost on me. But anybody who donated bitcoin, it ended up going to victims of state sponsored terrorism, right? And anybody who clicked on the Hamas logo got directed to Rick Astley singing Never Gonna Give youe Up. So who says that bureaucrats don't have a sense of humor?

[Michael Lewis]

Oh no, they do. What they don't have, by and large, is a sense of themselves as characters. This was the thing that all the writers came away thinking, like, I'd find this person who'd done this unbelievable thing and I'd say, I wanna talk to you about it. And he goes, well, it wasn't really me, it was the team. You really have to talk to my bosses. It was very little ego. I guess what it is. These jobs self select for people who really like doing big important things but don't care credit or money. It's hard to believe that such people still exist in American life. Everybody else seems to be looking for fame and fortune. These are sort of like the opposite of reality TV stars. They got interested in a problem. They've worried the problem to death for 30 years. It's had enormous consequences and they don't expect anybody to pay attention.

[Tim Harford]

And then you get nervous when people do, or at least the bureaucracy around them gets nervous.

[Michael Lewis]

Well, that's right. That's really actually an important point because that was the other thing all the writers noticed. And this is maybe by a way to explain why there's this inefficiency in information about this, is that the bureaucracy has gotten so used to all attention being bad attention.

[Tim Harford]

So a journalist shows up and says, I'd just like to know what you're doing and why you're doing it.

[Michael Lewis]

And they assume this is gonna end with a congressional hearing and me getting fired and humiliated and prevented from doing anything for the rest of my life.

[Tim Harford]

Whereas in fact, it's like, no, I just wanna know what you're doing because it's amazing. What you're doing. And I wanna tell everyone what you're doing.

[Michael Lewis]

That's right. In themselves are not as wary because they aren't doing anything bad. It's the political people above them are worried that this story will somehow make the White House look bad. And they can't imagine how it would make the White House look good.

[Tim Harford]

Yeah. And there is a story to be told, I think also about how the poor reputation of government bureaucracy just makes their life harder, irrespective of the politics itself. I think you profiled the woman who studies rare diseases.

[Michael Lewis]

Yes. So she doesn't really study rare diseases. She's had a bunch of them. Her name's Heather Stone. And let me just tell you how I found her, because that sort of explains what her role is in the world. So back when I was working on my Covid book, the Premonition, one of the characters was a researcher named Joe derisi, who's like, he was a superhero in bio research. And Joe, he was working on Covid, but at the same time, he had discovered what he thought might be a treatment for a rare brain eating amoeba called Ballamuthia. I'd never heard of this thing. Nobody had ever heard of this thing. It was discovered in, like the 1990s in the San Diego Zoo.

[Tim Harford]

But subsequently, now I'm now having nightmares about it. So thank you for telling me. It's terrifying.

[Michael Lewis]

It should be. Yeah. Because there's some tens of thousands of cases each year in the United States of people dying of unidentified encephalitis. It's like something's going on in their brain and they never figure it out. They die. It's just encephalitis. There was a woman whose brain was being eaten by something. They couldn't figure out what rolls into the UCSF emergency room. Joe gets involved. Eventually she dies. He gets involved. Too late. But he's able to identify the bug that's in her brain. And it's this Ballamuthia mandrillis, it's called. It's a brain eating amoeba. He then very cleverly, he says, well, what could you do to treat this? In his lab, he has his graduate students bombard Ballamouthia with every drug that's been approved either in Europe or the United States, and find that one drug, a UTI drug used in Europe called nitroxyline, kills the Ballamouthia. Clearly, it doesn't kill people. People are taking it for UTIs. So, like, why not try this? And lo and behold, even Though it's rare, pretty shortly thereafter, someone else rolls into the emergency room, has the same symptoms. They find that he has Balamouthi in his brain. They give him the nitroxyline, and he survives. Yeah. I say to him, I said, man, that's great. Now everybody will know there's at least something you can treat it with. And he says, nope, doesn't work that way. He said, maybe we'll be able to publish a scientific paper. Maybe doctors will notice it. But there's every possibility that if you roll into a hospital with Ballamouthi anywhere else in America, that they won't even know we did this work.

[Tim Harford]

There's two problems, right? So one problem is you didn't run a randomized trial, so you can't be sure. Maybe it was a fluke.

[Michael Lewis]

Correct.

[Tim Harford]

It's still interesting that you had a theory and you gave him the drug and he got better. So maybe. But then your second problem is, how do you tell people that maybe.

[Michael Lewis]

Yes, but with these rare diseases, you're never gonna have a randomized trial. And when they're fatal, if you roll in, Tim, with ballamuthia in your brain, would you rather them throw some nitroxyline in you or not? If they don't, we know what's gonna happen if they don't. So your brain is gonna get eaten. That's bad. So why not? And the other side of this is that because it's a rare disease, the pharmaceutical industry has no interest in it. It's like, there's no money in it. Not enough people are gonna have this happen to them. By the way, the way you apparently get it is by ingesting dirt. So be careful with dirt when you're gardening. Don't put your hands to your mouth. Anyway, so Joe says to me, this is a natural place for, like, government to intervene, to at least collate, because people like me are doing this stuff all the time. And there's a woman in the Food and Drug Administration named Heather Stone who is kind of all by herself, basically decided to tackle this problem. She's created an app that tried to gather every instance, every of a rare disease being treated around the world, how it was treated, and what the outcome was. There's hope for people who have rare diseases, but the government does not have the energy anymore to get behind Heather Stone's creation. They're unwilling to really promote it. She's a woman on her own, like, going to medical conferences, trying to persuade doctors to plug in their rare disease treatment, their cases into her app. It's going nowhere. What happens? The story in the end is about a little girl, a six year old girl in Arkansas who rolls in and takes them forever to find that she's got ballamuthia. But she has ballamouthia, the completely screwed up way in which her life is saved. The little girl in Arkansas's parents google around and find that Heather Stone has been thanked by Joe derisi for helping him get his hands on nitroxyline. And they get personally in touch with her and she makes sure that they get the drug and her life is saved. But at the very same time, just like 40 miles from Joe Derisi's office in California, another little girl got ballamouthia, never heard of the cure and died. And it's sort of like a parable of good and bad government. Like, do you. What kind of government do you want to have? A government that is emboldened and strengthened to actually follow through on this really good idea of how to deal with an intractable problem? Or a government that actually has kind of lost its spirit and its energy because she created the app Cure id, it's called. It should be useful. It should be something people pay attention. It should be something that the government throws its credibility behind. But then, you know, the government has less credibility. And it's a story of the frustrating, of the impulses of people who previously might have done really great things in the government. So it's a sad story. It's a sad story masquerading as a happy story, but a kind of amazing story.

[Tim Harford]

It's absolutely amazing.

[Michael Lewis]

There's this thing that kind of springs from between the lines of the whole book. These people feel like people who have figured out the way to lead a meaningful life. And this brings us back to effective altruism. One of the keys to a meaningful life is to find ways outside of yourself, find ways to live for things other than yourself. You know, Sam Bankman Fried groped towards this in his own weird way. These people put their finger on it right away. There are problems I can solve and it will help others. And never mind how much I'm paid or whether I'm acknowledged for it. And I'm not wired to do that. I need more attention than I should, but they are, and we should be just grateful for them instead of heaping scorn and derision upon them.

[Tim Harford]

I've been talking to Michael Lewis. Michael is the author of Going Infinite and a new book with co authors who is government. Michael, it's been great to talk to you.

[Michael Lewis]

Thank you always fun Tim and you.

[Tim Harford]

Can listen to Michael's podcast Against the Rules wherever you get your podcasts. As for me, I will be back next week with another Cautionary Tale. For a full list of our sources, see the show notes@tim harford.com Cautionary Tales is written by me, Tim Harford, with Andrew Wright, Alice Fiennes and Ryan Dilley. It's produced by Georgia Mills and Marilyn Rusty. The sound design and original music are the work of Pascal Wise. Additional sound design is by Carlos San Juan at Brain Audio. Ben Nadaff Haffrey edited the scripts. The show features the voice talents of Melanie Guttridge, Stella Harford, Oliver Hembrough, Sarah Jupp, Misea Munro, Jamal Westman and Rufus Wright. The show also wouldn't have been possible without the work of Jacob Weissman, Greta Cohn, Sarah Nix, Eric Sandler, Carrie Brodie, Christina Sullivan, Keira Posey and Owen Miller. Cautionary Tales is a production of Pushkin Industries. It's recorded at Wardour Studios in London by Tom Berry. If you like the show, please remember to share, rate and review. It really makes a difference to us. And if you want to hear the show ad free, sign up to Pushkin plus on the show page on Apple Podcasts or@Pushkin FM. Slashplus. This is an iHeart podcast.